Worcester loses $675,000 in federal funds

Several local programs that receive federal funds through the city are facing reductions in their allocations for the final quarter of this fiscal year because of federal budget sequestration.

Since the cuts will have to be implemented over just a three-month period, City Manager Michael V. O’Brien said they will have a four times greater impact on programs than had the cuts been made at the beginning of the year.

Automatic, across-the-board spending reductions triggered by sequestration are expected to amount to an 8.2 percent cut in federal funding coming to the city, he said.

The manager said that would equate to more than $675,000 cuts to the following programs: community Development Block Grant, HOME Investment Partnership, Emergency Solutions Grant, Housing Opportunities for People with AIDS, and Healthy Homes and Lead Hazard Control.

The programs that will be affected by the funding cuts include food pantries, affordable housing programs, after-school programs, social service case management and homelessness prevention, he said.

“These cuts, affecting the current fiscal year, will need to be implemented within three months of the current program year,” Mr. O’Brien wrote in a recent report to the City Council. “Thus, the cuts will be four times as impactful on programmatic operations in the next quarter than if they had been full-year reductions. While still undermined, these reductions will undoubtedly playing into (next fiscal year’s) allocations as well.”

Timothy J. McGourthy, the city’s chief development officer and whose office oversees the distribution of federal funds to various programs, said no reductions will occur until the U.S. Department of Housing and Urban Development provides the city with specific program cuts.

He said the city expects to receive that by next month.

“This will be a difficult process,” Mr. McGourthy said. “Many worthy programs will be negatively impacted. We will work closely with our federal and local partners to mitigate these impacts to the extent possible.”

Upon receiving specific programs cuts from HUD, he said the city will contact each program and agency that receives federal funding through the city to let them know what their new allocation amount will be for the last quarter of this program year.

In addition, the city, if required by HUD, will amend the agreements the city has with them to appropriately identify available funding and client/output reductions as a result of the amended budget, Mr. McGourthy added.

“Adjustments to city administration funding will also be addressed,” he said. The city is already bracing for an 8 percent to 10 percent reduction in federal funding next fiscal year for its Community Development Block Grant program. The allocation for this year was $3.9 million

The city has received 62 applications from programs and agencies seeking funding next fiscal year through the block grant program. The applications total roughly $4.5 million.